Aarvee Denims & Exports Ltd. (AARVEEDEN) - Chairman Speech

Company chairman speech

AARVEE DENIMS AND EXPORTS LIMITED
CHAIRMAN'S STATEMENT
Dear Shareholders,
It gives me great pleasure to communicate to the shareholders of the
company as we move forward towards the next millennium. Your company has
performed reasonably well under the extremely challenging times. The year
has been very volatile on social, political and economic front. The new
Government has initiated certain measures in the Budget 1998 to revive the
sagging Indian industry. I feel that it is the demand side of economy that
needs to be perked up.
Your company has achieved a turnover for Rs. 10762.87 lacs, comprising of
Rs. 7565.04 lacs of Denim Fabric and Rs. 3197.83 lacs of yarn as against
Rs. 6573.10 lacs achieved in previous year, comprising of Rs. 6183.78 lacs
of Denim Fabric and Rs. 389.32 lacs of Yarn. (This is on a Year-on-Year 12
months pro-rata basis.) The sale of Denim grew by 22%. The company
achieved an export turnover of Rs. 1118.70 lacs (including third party
exports of Rs. 224 lacs), as against the exports of Rs. 277.05 lacs,
showing a quantum jump of more than 300% over the last year. Despite a
sudden fall in the domestic prices of denim fabric in the last quarter of
1997-98 due to South East Asian Crisis, the company could more or less
maintain its operating margins. Since the interest cost is a major burden
on the profit margins, your company has initiated a financial restructuring
programme.
Production volume increased nearly 24% from 7.88 million meters to 9.79
million meters per annum. The company has added 24 nos. High Speed
Tsudakoma Airjet Looms to match with the increased Dyeing-Sizing capacity.
Of these, 15 looms started operations in August 1997 and 9 looms started
operations in March 1998. These machines conform to the highest
international quality standards. The company has also increased its
spinning capacity by additional 2000 t.p.a., which has been commissioned
during the first quarter of 1998-99. The highest levels of safety
standards have been maintained during commissioning of the projects and
production.
Your company has taken up the task of educating its dealers, customers and
various segments of textile industry on denim by starting a bi-monthly
newsletter in the name "D-Vogue" in October 1997. D-Vogue gives a concise
insight into the important aspects of denim industry, latest news, views
and developing trends.
Your company also held an exclusive denim fashion show titled "Denim
Dynamics on the ramp" in October 1997 at Mumbai. The collections designed
by Bhairavi Jaikishan showed an exciting combination of fashion and
functionality with themes like Summer Pastels, Water Baby, Safari, Snowball
and Ethnic. The collection was presented by leading models like Shikha
Swaroop, Mehr Bhasin, Manpreet Brar, etc. We are proud to inform our
investors that the company has developed its own web-site on the Internet.
To have a glimpse, visit "www.aarvee-denims.com". Internet has already
changed the way business is done abroad and is soon gaining popularity in
India.
Your company has begun the current year on very optimistic note and has
already achieved a turnover of Rs. 1905.05 lacs in the first quarter of
1998-99. The exports is around 45% of this. Our strategy has been to
focus on the core business of selling denim fabric rather than going in for
any unrelated diversification. We have re-oriented ourselves towards
Shareholder Value Enhancement - the key to measure success. The world map
is the market for us and we are confident of making our mark on it. We may
be small today but we are striving hard in moving towards our goal of
becoming an international force to reckon with. The commitment is 100% -
nothing less.
VINOD P. ARORA
CHAIRMAN